Hyperliquid Trader Bleeds $3.7M in Brutal Cascade of 5 Liquidations

Another day, another crypto wreck—only this one came with a side of humiliation.

Some poor soul just got steamrolled by Hyperliquid’s margin engine, not once, but five times in what looks like a masterclass in how not to trade leverage. The damage? A cool $3.7 million up in smoke.

Margin calls don’t negotiate. The trader—who probably thought they’d cracked the code—got shredded by cascading liquidations while the market barely blinked. No lifelines, no mercy—just cold, algorithmic efficiency.

Here’s the kicker: this wasn’t some retail gambler. That’s serious capital vanishing into the perpetual swap abyss. Maybe next time they’ll remember that in crypto, the house always wins… unless you’re the house.

Hyperliquid trader makes losses after Q1 bull run

The trader had opened $200 million worth of 50x Leveraged short positions on BTC and ETH just hours before US President Donald Trump signed an executive order establishing a national crypto reserve in March. 

The market had seen the order as bullish, and pushed crypto markets alongside BTC to highs, triggering Qwatio’s early losses. They are also known for having held a large position in the Melania coin during its initial launch earlier in 2025.

After losing thousands of dollars Qwatio continued shorting the two largest coins by market cap into the second quarter of the year. On July 4, after already being liquidated 10 times, the trader opened another short position against Bitcoin, betting 21 BTC valued at $2.3 million while the asset was trading at $109,135, just $2,000 down from its all-time high level. 

The coin has since dropped to $108,993, and Qwatio will be hoping it goes further down against the predictions of analysts, who have asserted that BTC is in a “weak positive” short-term market sentiment.

Market wide short and long liquidations surge

Qwatio’s losses took place against the backdrop of several liquidations in the crypto derivatives market. In the 24-hour period ending July 7, total liquidations across all major cryptocurrencies reached $184.16 million, according to CoinGlass. 

The numbers included $47.14 million in long positions and $137.01 million in short positions, a strong squeeze on bearish traders as markets are trading in the green.

Ethereum led the liquidation totals, with $64.14 million wiped out, $49.62 million from short positions and $14.52 million from longs. Bitcoin followed, with $35.38 million liquidated, including $31.25 million in short positions. 

Many traders, like Qwatio, misjudged the market direction and were caught off-guard by the strength of the market uptick.

NVT golden cross on BTC chart spells price topping

According to a CryptoQuant take, the NVT golden cross successfully flagged three recent tops in 2025: February 2, March 24, and June 16. On each occasion, the indicator peaked above the 2.2 threshold, coinciding with BTC price highs of $97,600, $87,500, and $106,800 respectively. Each peak was followed by corrections of -23.65%, -16.06%, and -9.87%.

As of the latest reading, the NVT GC stands at 1.98, yet to breach the 2.2 signal line again, but has room for a price momentum on the upside. Analysts believe that if the NVT crosses 2.2, there will be a price pullback for several days.

Bitcoin’s price rise has triggered a chain reaction across derivatives platforms, particularly on Binance, where short positions have been on the rise. 

Many traders appeared to interpret the rally as a selling opportunity. Still, the continued ascent in BTC’s price forced many of these short-sellers into liquidation or margin calls.

The liquidations have helped fuel a bullish feedback loop, accelerating the upward price movement. When bearish bets are squeezed out of the market, bullish momentum builds, a pattern visible in this week’s trading behavior.

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